President Heidar Aliyev and other Azerbaijani leaders are warning they will opt for a military solution to the Nagorno-Karabakh conflict should current peace talks fail. But the threat of renewed warfare is brushed aside by officials in Yerevan and -- especially -- Stepanakert, who are confident they can easily win any new conflict with Baku. RFE/RL correspondent Emil Danielyan recently visited a Karabakh Armenian unit, and here is his report.

STEPANAKERT, 6 July 2001 (RFE/RL) -- It's business as usual at the headquarters of a Karabakh Armenian army unit near Agdam, a town in one of the occupied territories outside Nagorno-Karabakh that was largely devastated in the 1990s war.

Sitting on a porch that protects them from the scorching sun, top officers from this tank regiment chat about their day-to-day affairs. The relaxed atmosphere is not disturbed when they are reminded of recent Azerbaijani threats to regain control of Karabakh and surrounding Armenian-occupied territories by force.

The battle-hardened soldiers are confident that the Azerbaijani army, dug in some 20 kilometers to the east, still lacks the strength and morale to avenge the humiliating defeat it suffered seven years ago. The officers, whose tanks rolled into the streets of this Azerbaijani town in July 1993, dismiss talk of war in Baku as nothing more than rhetoric. So does the leadership of the unrecognized Nagorno-Karabakh Republic.

President Heidar Aliyev and other Azerbaijani leaders have recently been warning they will opt for a military solution to the Karabakh conflict should current peace talks fail. In a speech 10 days ago (26 June), Aliyev said his troops are "capable of liberating Azerbaijan's occupied lands and restoring Azerbaijan's territorial integrity."

Such statements come amid growing calls by Azerbaijani opposition parties, civic organizations, and opinion leaders for serious preparations for another war with the Armenians. They argue that peace proposals made by international mediators do not envisage the restoration of Azerbaijani rule in Karabakh and that Baku could obtain more concessions either by threats of renewed fighting or by actually resuming hostilities. This, they say, necessitates a massive military buildup.

Armenian troops currently occupy Karabakh and six neighboring Azerbaijani districts, which altogether make up at least 15 percent of the country's territory. According to Azerbaijani estimates, some 800,000 Azerbaijanis were displaced because of the war and are now scattered across the country, many of them in poor conditions.

For Baku, the return of the six occupied territories must be the basis of a peace accord. Up to now, Azerbaijani authorities have seemed willing to accord a high degree of autonomy -- but not formal independence -- to Nagorno-Karabakh.

Whatever the real intentions of the Azerbaijani leadership, their recent talk of war is brushed aside by officials in Yerevan and, especially, Stepanakert. The commander of the Karabakh Defense Army, General Seyran Ohanian, went on Karabakh state television over the weekend to warn Baku against trying the military option. He said his Armenia-backed forces are ready for any such development.

"I can say that the spirit of our soldiers is so high, our military hardware in such good shape, and the devotion to our cause so great that we are ready to repulse any provocation."

Arkady Ghukasian, the president of the self-proclaimed Nagorno-Karabakh Republic, calls Baku's threats "blackmail." He says they are intended to be used as a bargaining chip in the ongoing peace negotiations sponsored by the Organization for Security and Cooperation in Europe. Ghukasian told RFE/RL earlier this week that Azerbaijan is "unable to solve the problem on the battlefield."

Karabkh Armenian military officials say that, apart from occasional exchanges of sniper fire, the situation along the line of contact remains calm. So far, they have detected no major troop movements on the Azerbaijani side.

Renewed fighting seems unlikely now that the conflicting parties have reported progress in peace talks since the beginning of the year. U.S., French, and Russian negotiators, who will tour the conflict zone next week, still hope that a framework peace accord will be signed this year.

The failure of the peace process would leave the shaky truce, which ended the 1991 to 1994 war, hanging in the balance. Earlier, more than 20,000 people died and hundreds of thousands were left displaced as a result of three years of fierce fighting.

Parallel to the ongoing negotiations, both parties conduct regular military exercises to improve the combat readiness of their armed forces. Three months ago, the Karabakh government ordered a one-day call-up of all army reservists.

Analysts note there is a great disparity between the human resources of Azerbaijan and those of the tiny enclave. But they point out the difference in numbers is more than offset by the combat experience of the Karabakh soldiers and by military aid from Armenia proper.

With the two armies now better equipped and trained, another war could be even bloodier. It would also endanger multimillion-dollar investments made by Western multinational companies in Azerbaijan's oil sector. This is seen as one of the main reasons why the United States is so keen to push the peace process forward.

Yet oil is probably the least important preoccupation of the young soldiers playing soccer at a military base in Stepanakert -- their brief weekend relaxation. Samvel is a 19-year-old conscript from the northern Martakert district who still has memories of the first war, when he and his parents fled their village hours before it was captured and looted by Azerbaijani forces in the summer of 1992. It was liberated eight months later, at the start of the successful Armenian offensive of 1993.

Samvel says: "If they attack us again, we'll still fight better than they. We'll just sweep them away all the way up to Baku and their [Caspian] sea."

Roman Balasanian, a 35-year-old war veteran, is less aggressive but equally self-confident: "We remain prepared for anything," he says. "They should have no hopes of victory -- we'll win again."